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2016 (9) TMI 324 - AT - Service TaxDenial of refund claim - Rule 5 of CCR, 2004 – input services – export of services – export turnover – should the turnover of branches of assesse located in South Africa and UK be treated as export turnover? - Section 65B(44) - services – POPOS rules, 2012 - Rule 2 (6A) - Export of Services – Held that: - As per explanation 3(b) of Section 65B(44), if a person is having two establishment one in taxable territory and other in non taxable territory both shall be treated as distinct persons. The branch office of the assessee is in non- taxable territory, therefore the branches are distinct persons - the business turnover of the said branches can not be treated export turnover of the assesse - branches of the assessee who are provider of service not located in taxable territory, the service provided by the branches of the assessee are not export of service. Whether the value of service provided by the overseas branches of the assessee should be included in the ‘total turnover’ of the assesse - Held that: - Once it is held that branches’ turnover is not export being branches are distinct person, the same principle will apply for the purpose of total turnover of the assessee. Department cannot take contrary stand that in one hand the branches turnover is not export turnover and in other hand it is addable in total turnover of the assesse - branches turnover neither included in export turnover nor in the total turnover of the assesse – appeal disposed off – denial of refund justified – decided against assessee.
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